We are all keen on developing our businesses. For companies who are not normally involved in construction this often involves expansion in facilities and this in turn often leads to a requirement for bigger premises. Whether you work from home, or own a property that you trade from, then this may require you to engage a construction firm who in turn will engage sub contractors.
This all involves multiple relationships with new contractors on a complicated one off project. Your question ‘is how well do you want to be prepared for the upcoming challenges?’. Here are a few considerations that you will want to think about…
What Could Possibly Go Wrong?
Construction & engineering contracts are delicate in nature. In order for even a small project to flow from contract to completion without disputes, a long list of things must go right. It starts with an accurate, clear and comprehensive contract that will hopefully make overcoming problems easy, but you also have to make sure the right people are hired to complete the project and all necessary resources and tools are accessible and in great working condition.
You even need the weather to cooperate if some construction and engineering projects are to remain on schedule and complete without complications. According to EC Harris, the financial cost of construction or engineering project disputes has increased by more than 40% and the length of time required to settle disputes has lengthened.
This means problems with even a small construction project will not cost you more than ever before, so finding the right help is essential. Helping companies survive arbitration and mediation for engineering and construction disputes is what I do for a living, so I know what it takes to get through this type of conflict with you company’s reputation and financial integrity intact.
Are You at Risk for a Dispute?
If you work in the construction or engineering field, you are always at risk for disagreement with other companies and clients. Understanding these primary causes of project disputes will help you design your work processes to limit that risk as much as possible:
Inadequate Project Management
How efficient are you when it comes to coordinating between all companies and subcontractors coming together to complete a project? Are communication lines open between all parties at all times? Are contractors and subcontractors working at an agreeable pace? A great project management team is one of your greatest assets for avoiding tension over missed deadlines and blown budgets.
It is impossible to predict everything that may develop over the course of a long project, and unforeseen circumstances can lead to disagreements. You construction and engineering contracts must be detailed and precise, even for the smallest project. The more detail you put in, the less likely you are to come across circumstances not covered in the terms and conditions.
Engineering and construction projects are impossible to complete without the expertise and skill of many different people blending together. Humans are unpredictable, and there are often different cultures, attitudes, personalities and expectations coming together within a single worksite. Proper management is essential to eliminate slowdowns and other problems that may arise due to human interactions.
Mediation and Litigation
When a disagreement arises, your first step is to sit down and try to find a middle ground face-to-face. This may involve hiring a contract administrator if the issue surrounds interim payment disagreements. The goal is to bring both sides together to consider the terms of any applicable construction and engineering contracts and determine the fairest solution to the problem.
When basic mediation fails, barristers, mediators and arbitrators are often used to help find a solution to the problem. Independent experts are sometimes called to help settle technical disputes, or you may have other witnesses that you need to secure in order to prove your case. Ideally, you will work outside of the courtroom to find a solution in private.
When even that fails, litigation is the last resort. Not only is that expensive, but you risk putting your company’s name in the public eye as well. You never know what a judge is going to order, so resolving disputes during mediation is always best.
Here are two videos that can give you more information.
The first on is from http://stewartpattersonbarrister.co.uk, a very successful lawyer who specialises in construction and engineering disputes and is a fully qualified mediator and arbitrator. He is based in the UK. You can find a full and very useful guide to ADR on his site here: http://stewartpattersonbarrister.co.uk/a-guide-to-resolving-construction-disputes/
The second video is from a lawyer, Phillip Taylor who is detailing information about Construction Law.
As a final resource, the Law Society can be a useful place to go. Here is a link that will take you to the search area for all points to do with Commercial Property: Commercial Property